Learn more about our Cloud Technology ETF
Key Takeaways
- WFH behaviour will continue to boost Cloud
spending post-COVID – rising to $500bn within 2 years.
- Majority of IT spending is moving to the Cloud
away from hardware.
- Digital Entertainment - online Video and Gaming
seeing huge usage. Asia fastest growing region.
- Gaming is already triple the size of Hollywood
Box Office ($152bn vs $43bn).
- 50mn more Americans played games in 2020.
- Cloud usage in Asia for Online Gaming = fastest
growing global area for Digital Entertainment.
- AI & 5G boosting Edge computing & Cloud
spending.
- Multi & Hybrid Cloud increasingly popular
due to open architecture.
- SaaS (Software as a Service) will continue to
receive ~50% of Cloud spending.
- Alibaba Cloud overtaking Google Cloud - as 3rd
largest global cloud revenues.
- Amazons’ AWS generates over 50% of group profits.
(see chart)
Performance Review
Cloud Technology ETF (SKYY) Returns
May
|
12 Month*
|
-0.32%
|
34.19%
|
Past performance is no guarantee
of future performance.
Source: Solactive, HANetf
*12
Month figures based on 01.06.20 - 31.05.21.
HAN-GINS Cloud Technology ETF (SKYY) was mostly flat for May
losing 0.3% but remains up 34.2% over the past 12 months. SKYY offers broad exposure to all key areas
of the Cloud revolution – infrastructure, security, platform and software – as
a service. SKYY’s large-cap and
infrastructure exposure ensures it accurately tracks global cloud activity well
beyond just the US and software developers.
Gaming and online Video streaming continues to boost cloud
usage, with Gaming already triple the size of Hollywood’s Box office.
In May, the largest contributors to our Cloud Technology ETF were varied – but recent
large-scale US hack attacks has pushed cloud security concerns to the forefront
– benefiting the likes Crowdstrike (up another 6.5% after April gains of
14.3%).
Ooma (17.4%), Nutanix (16.5%) and Fireeye (12.6%)
also benefited from cloud cybersecurity concerns and the growth of hybrid cloud
services. Cloud groups involved in the detection and prevention of major
cyberattacks are increasingly acquisition targets too for the large Cloud
platforms run by AWS, Azure and Google.
Big Tech giants are expanding the Cloud reach into the fast-growing
Healthcare sector, as hospitals increasingly switch to Virtual services,
Wearables and Telemedicine. Microsoft’s $16bn acquisition of Nuance
Communications reinforces this trend. Nuance is a leader in the field of
digitizing doctor patient visit details/conversations and clinical
documentation.
In 2021, a clear trend is the move to more hybrid/multi-cloud
platforms and infrastructure. Salesforce,
IBM and SAP are expected to benefit from this open architecture - allowing the
easy flow of data across multiple Clouds.
Holdings
|
% Average Weight
|
Total Return (%)
|
Contribution to Return (%)
|
OOMA INC
|
1.49
|
17.42
|
0.25
|
NUTANIX INC - A
|
1.15
|
16.53
|
0.18
|
POSCO ICT CO LTD
|
1.32
|
12.88
|
0.17
|
FIREEYE INC
|
1.20
|
12.55
|
0.15
|
A10 NETWORKS INC
|
1.20
|
12.10
|
0.14
|
FORTINET INC
|
1.81
|
7.01
|
0.12
|
NVIDIA CORP
|
1.48
|
8.23
|
0.12
|
BEIJING SINNET TECHNOLOGY-A
|
1.17
|
10.92
|
0.12
|
ARISTA NETWORKS INC
|
1.47
|
7.68
|
0.11
|
INFOSYS LTD-SP ADR
|
1.43
|
8.08
|
0.11
|
MONTNETS CLOUD TECH
|
1.37
|
7.62
|
0.10
|
TENABLE HOLDINGS INC
|
0.94
|
11.48
|
0.10
|
CROWDSTRIKE HOLDINGS INC - A
|
1.18
|
6.54
|
0.08
|
INSIGHT ENTERPRISES INC
|
1.77
|
4.09
|
0.07
|
Past performance is no guarantee of future performance.
Source: Solactive. Data as of 31.05.21
HAN-GINS Cloud Technology UCITS ETF –
Performance (As of 31.05.21)
|
1M
|
3M
|
6M
|
YTD
|
12M
|
SI
|
HAN-GINS Cloud Tech UCITS ETF
|
-0.32%
|
5.46%
|
12.69%
|
8.09%
|
34.19%
|
66.03%
|
Solactive Cloud Technology Index (NTR)
|
-0.31%
|
5.62%
|
12.99%
|
8.33%
|
34.88%
|
67.27%
|
Past performance for the index is in USD. Past performance
is not an indicator for future results and should not be the sole factor of
consideration when selecting a product. Investors should read the prospectus of
the Issuer (“Prospectus”) before investing and should refer to the section of
the Prospectus entitled ‘Risk Factors’ for further details of risks associated
with an investment in this product. Source: Bloomberg / HANetf. Data as of 31/05/2021
Past performance is no guarantee of future performance.
Source of all data: Solactive/ HANetf as of 31/05/2021
Industry News
As of April 2021, Canalys reports that the worldwide cloud
market grew 35% this quarter to $41.8 billion. AWS has 32% of the market,
followed by Azure at 19%, Google at 7%, Alibaba Cloud close behind.
Technavio a leading consultancy predicts worldwide cloud
spend will grow at an annualized 17% between 2021-2025. They see growth of 20.4% just for 2021 = with
the USD contributing 40% of these gains. Incremental spending growth of close
to $300bn is expected over the next 4 years.
Gartner estimates 37% of all public cloud services revenue
is from SaaS applications and services (in 2021), projected to reach $122.6bn
with CRM being the dominant application category. Corporates are prioritising cloud
infrastructure investment to better support virtual workforces, supply chains,
partners, and service partners.
SaaS,
the largest segment of public cloud spending - is forecast to grow 19.3% this
year. (Source: https://cloudcomputing-news.net/news/2021/may/10/gartner-predicts-the-public-cloud-services-market-will-reach-397-4bn-by-2022-what-you-need-to-know/ and https://enterpriseirregulars.com/177360/gartner-predicts-public-cloud-services-market-will-reach-397-4b-by-2022/)

For illustrative purposes only. Source: https://www.prnewswire.com/news-releases/global-cloud-computing-market--over--287-billion-growth-expected-during-2021-2025--technavio-301306058.html
Cloud spending is not expected to slow down as the pandemic
gets under control. Remote work habits
are expected to continue and Cloud computing is arguably the centrepiece of the
world’s technical response to the COVID-19 crisis.
By the end of 2021, we expect 60% of companies[1] will utilise public cloud
platforms and 25% of developers
will use serverless. Cloud native technology is driving enterprise
digital transformation strategies.[2] Other key trends include:
Alibaba Cloud
is expected to take over the No. 3 revenue spot globally, after Amazon
Web Services (AWS) and Microsoft Azure.[3]
Constituent News
SKYY is now even more representative of the Cloud theme
globally – with 75 holdings, expanding from 50 (fast-growing players). Our
updated Equal Weighted approach, captures smaller and more innovative Cloud
companies. Each holding now averages around
1.3% at rebalance.
These changes,
ensures SKYY’s broader holdings mirror the global revenue mix across the Cloud
industry and its subthemes:
Highlights include:
- More representative of Cloud industry with SaaS
holdings (Software as a Service) now the largest weighting at 66%, PaaS 20% and
IaaS 14%.
- A new ESG screen follows UN Global Compact rules
(excludes controversial weapons, fossil fuels etc).
- SKYY is globally diversified - US exposure 77.2%,
followed by China 7.8%, Israel 3.6%, Germany 2.8% and Japan 2.2%.
- Amazons’ AWS generates over 50% of group profits
now (see chart).

For illustrative purposes
only. Source: https://www.parkmycloud.com/blog/aws-vs-azure-vs-google-cloud-market-share/
Outlook
The majority of IT corporate spend is moving away from
onsite hardware and servers to remote Cloud usage.[4] Data centre chip revenues and Hyperscale
Cloud have seen significant revenue boosts during COVID.
SaaS (Software as a Service) will continue to dominate Cloud
spending (see chart below).
Infrastructure- and Platform as a Service areas together currently
represent the remaining ~50% of Cloud computing revenues.
Hybrid Cloud’s growing popularity using open-source software
such as Linux ensures many more businesses can now embrace the Cloud. This ensures
faster scaling up for business globally. The shift to hybrid cloud translates
to a blurring of the lines between the public cloud and the traditional data
centre.
Artificial intelligence, analytics, security, IoT, and edge
computing will likely be key differentiators among the top cloud service
providers – along with serverless and managed services.
Cloud usage in Asia for online gaming and streaming has made
this region the fastest growing area for digital entertainment.
Learn more about our cloud technology ETF here